Tesla reportedly abandons plans to make a less expensive $25,000 electric vehicle

The Tesla Model 2 may be no more. According to Reuters, Elon Musk has canceled the company’s plans to build a low-cost electric vehicle in favor of going all in on a robotaxi. The news outlet, citing three sources in the know, said the decision was communicated to employees during an all-hands meeting in late February. For years, Musk has been promising an affordable electric vehicle, likely priced at $25,000, as a way to broaden the appeal of plug-in vehicles.

There are not any Chinese cars currently available for sale in the US due to high tariffs. “Frankly, if there are not trade barriers established, they will pretty much demolish most other car companies in the world,” Musk said. “They are extremely good.” While Tesla spent years developing the expensive, polarizing Cybertruck, the company lost its place as the world’s top producer of electrified vehicles to China’s BYD. The company said it produced 3.02 million EVs in 2023, compared to Tesla’s 1.

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